Rising Above the Storm: Strategies for Building Resilient Brands during Challenging Times in Asia
In volatile economic times, brand value is paramount, the key factor that retains customers’ shopping loyalty even when belts are tightened. But in trying periods, where the value of each dollar rises higher, the success of brand building can be fleeting.
Brand-building efforts in Asia have historically lagged behind those in Western countries. With the exception of more developed, markets such as Korea and Japan with sophisticated and innovative long-established global brands, many companies from Asia have struggled to build recognisable brands outside their domestic markets. However, this has been changing over time and in the past decade, Chinese brands in particular have begun to gain significant consumer ‘mind-share’ in important global markets, such as PC and laptop computers, and more recently, electric vehicles and local beauty.
The most common brand-building principles center around a few key principles, including understanding customer journeys, creating a bond, and developing trust between consumers and brands. A less frequently heard principle, which is equally important, is ensuring that your brand can react to customers’ evolving buying patterns.
2020 saw the start of yet another turbulent financial market in Asia, buffeted by a succession of crises, including recession, a pandemic, and a trade war, translating to a cautionary tale for 2024. The possibility of an impending recession will cause changes to customers’ values and priorities as they reassess their spending habits and capabilities, but it also offers brands the ideal opportunity for brand building.
As a senior leader in the online retail space, what are the critical questions you should consider when building your brand in a challenging and volatile economic environment?
When customers are feeling financial pressure, how can my brand act with integrity to show value and win customer trust?
Let’s face it. Regardless of the economy, increasing prices is often brands’ go-to solution to improve revenue sales. This may be an effective strategy in sectors such as FMCG which continue to experience robust demand in challenging times, but is it always the best?
A more proactive approach could be to meet your changing customer needs, retaining existing customers while winning over new ones. Think about what your customers need and want. Would introducing a lower-cost brand line or repackaging for smaller product sizes be a good choice? Or is there something even better?
Photo by Nathan Dumlao on Unsplash
In 2022, Crocs saw $310 million in sales, driven from the hype it got during the pandemic as it remained true in their advocacy for comfort and personalisation. Crocs took a step further by listening and responding to their customers, donating 860,000 pairs to healthcare workers in the US at the peak of the pandemic.
Are my customers thinking about value differently?
Brands often take pride in maintaining product quality, customer service, or competitive pricing. These strategies are often the unchanging root value of the brand, but are your customers still thinking and prioritising the same way pre- and during a challenging economy?
In a well-going economy, it’s convenient to let your online performance slip and ‘fix it later’. Think slower page load speeds, mediocre recommendations, an occasional glitch in the mobile user interface, or a disjointed payment experience.
During a recession, a high-quality customer experience is the factor that makes or breaks your connection with your customers. But with the majority mindset of ‘hard times so stay home’, your online presence is more important than ever. Fixing or optimising your web performance during this time becomes urgent and expensive, and a little too late.
Reconceptualising value in this way allows you to present a fresh new value proposition at just the time the customer may be looking for one. In a turbulent market, customers reserve the right to determine value as it appears to them at the time, and businesses must keep up.
Do I need to look again at my product line to ensure it’s exciting enough to my customers?
A tough economy does not always mean a recession, and customers are still willing to spend, but perhaps less freely than they were before. Especially in Asia, luxury brand sales tend to hold up well in periods of economic turmoil, such as 2008 or 2020, as consumers in need of some comfort splash out.
When Christian Dior launched its $2,000 Air Dior limited edition shoes despite COVID lockdowns in 2020, five million people signed up to the waitlist.
An old, uninventive product line might be enough to get by in good times but may not survive in a market where customers weigh each purchasing decision carefully and each transaction is hard-earned.
Speaking of a time she realized her offering had become stale and overcomplicated, homeware entrepreneur Martha Stewart said “I thought we were offering too many different styles of placemats in too many of the same colors. I wanted more colors and less variety.”
Can my business react rapidly to keep delighting the customer?
It goes without saying that many brands experienced large demand growth during the pandemic. However, post-pandemic, things returned to the ‘new normal’ and some brands were unable to adapt. For example, a temporary omnichannel strategy might have been established during the pandemic, but without action to implement a long-term plan, they end up falling short of their customer demands.
Photo by Solen Feyissa on Unsplash
Brands looking to grow and thrive in turbulent situations need to be able to adapt to new market developments and pivot fast. This involves senior decision makers rapidly aligning the brand with emerging trends. For example, Chinese cosmetics brands have been quick to see the potential for using influencer marketing on Tiktok (or its Chinese equivalent Douyin) to build brand awareness among young Asian women.
Known for their transcendent narratives and quality beauty supplies, Flower Knows generate an annual growth of 14.4% thanks to their product virality on Douyin and Tiktok. One study using data from NielsenIQ found that Chinese beauty brands that engaged their Tiktok audience with an engaging, entertainment-focused approach reported 34% faster growth in their first six months on the platform than those that followed a more traditional advertising approach.
Can I help customers live their values, even under financial pressure?
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